• PJM Requests Changes to Interconnection Process
  • March 14, 2012 | Authors: Kevin C. Fitzgerald; Peter S. Glaser; Kevin C. Greene; Clifford S. Sikora
  • Law Firms: Troutman Sanders LLP - Washington Office ; Troutman Sanders LLP - Atlanta Office ; Troutman Sanders LLP - Washington Office
  • On February 29, 2012, PJM Interconnection LLC (“PJM”), in an attempt to reduce bottlenecks in its interconnection queue and provide greater certainty and transparency, filed proposed revisions to its Open Access Transmission Tariff.  These revisions are a result of PJM’s stakeholder process and are designed to alter the process for how generation projects are analyzed before being allowed to connect to the transmission grid.

    PJM’s proposed revisions are:

    • Six-month queue cycles;
    • “Sliding queues” for projects that seek to modify the size of their interconnection requests by more than a specified amount;
    • “Alternate queues” for projects = 20 megawatts (“MW”) that, as determined through a screening process, will not have an impact on the PJM monitored transmission system;
    • Clarified timeframe for notifying PJM if a project is using Capacity Interconnection Rights that are transferring from a deactivating generator;
    • Reduced suspension rights if suspension will negatively impact the timing or cost of a subsequent queue project;
    • Modified deposits for projects that are >2 MW but = 20MW; and
    • Clarified provision concerning submission of System Impact Study data.

    The first revision would eliminate the current three-month queue structure and replace it with a six-month queue.  This will allow for customers that were earlier in the queue to wait and decide whether to proceed with their projects before a customer that is later in the queue begins their study phase.  Once a six-month queue cycle has closed, PJM will take a month to complete scoping meetings and its model build.  PJM customers will still have a one-month period to decide whether to move to the System Impact Study or withdraw.  PJM will then complete its feasibility studies within 120 days rather than 90 days under the current tariff.

    Next, PJM proposes a “sliding queue” that would allow customers to move to the beginning of the next queue if there is a reduction in capability beyond specified limits.  Under the current model a customer may reduce its capability by up to 60% before the return of the system impact study agreement, and by 20% of capability or 50 MW after the system impact agreement is executed but before executing an interconnection service agreement, without losing its place in the queue.  Any reductions below that would require the customer to withdraw the queue and restart the process.

    The proposal would allow for a customer to reduce its capability by as much as 60% before a feasibility study begins.  The customer may then reduce capability after the feasibility study but before the system impact study agreement by up to 15%.  If capability is reduced by more than 15% PJM will conduct an analysis to determine if the reduction is a material modification.  If the reduction is not a material modification then the customer may reduce capability as much as it wishes and retain its place in the queue.  If the reduction is a material modification then the customer may reduce capability by as much as 60% and slide to the beginning of the next queue.

    Additionally, PJM proposes to establish an alternative queue for projects with less than 20 MW capacity that has been determined will not have an impact on the PJM transmission system.  In order to qualify for this status a project must meet criteria such as (1) cannot be connected to PJM monitored transmission facility, (2) cannot be an uprate or addition to an existing facility, and (3) may not connect to any point of interconnection as another project.  The evaluation of these projects will be conducted by the transmission owner under the direction of PJM.

    PJM also proposes to require an interconnection customer to notify PJM if it intends to use transferred capacity interconnection rights on or before the System Impact Study Agreement is executed.  Also, PJM put forth changes designed to reduce the amount of time that an interconnection customer may suspend a project from three years to one year if the suspension will result in a material adverse impact on cost or timing of any subsequently queued projects.  PJM proposes to change the deposit structure of projects that are greater than 2 MW and less than 20 MW, to a flat refundable deposit of $10,000 - $15,000 depending on what month the project enters the queue.  And lastly, PJM proposes to allow 10 days for a customer to cure any deficiency of data in its system impact study, rather than removing the customer from the queue.

    PJM has requested an effective date of May 1, 2012 for the proposed tariff changes.